ActivityTaxable ActivityNon-passiveSch C/FIncome(Rev>Exp)taxable incomeLoss(Revdeductible lossPassiveSch ETaxable IncomeXnon-deductible lossNon-taxable Activitynon-taxable incomenondeductible expPassive activity (Sch E)1. Definition 1) Not materially participated(managed) in S corp & Partnership's biz operation(work 500h/Y ↑) 2) Any rental activity 2. Loss from passive activity > offset passiv..
